Skip to main content
6:00 am
this morning equity futures at least at this hour, you can see are indicated slightly higher. right now dow futures are up by over 11. s&p up by just about 1.2. the bond markets are closed this morning for veterans day as skroe poijoe pointed out, very important day yesterday and bond markets are recognizing that holiday today. congress is coming in to return to session tomorrow. and as we've been discussing that looming fiscal cliff is arguably the biggest factor driving the broader markets. two key voices debating yesterday about what has to be done for a compromise to be reached. >> is the bottom line that republicans losing this election means they have to give in and allow taxes to go up on wealthier americans? >> i think they've already agreed to that. you heard john boehner say that
6:01 am
already. we've had voteses in the senate where we've gotten rid of tax credits. i think that's a given. and i think that the vast majority of measures agree with that. the question is how do you do that and how do you allow taxes to rise at the same time you fix the real problem and that's uncontrolled entitlement spending and a government that has grown massively. >> i think if the house stands for anything, it's cut government spending as tom coburn said and i think we'll have to do more of it. we heard the mandate in 2010 where it was a clear mandate cut spending and we did, we cut $900 billion in spending that he can't like painful tos us. >> we'll continue our call to rise bol politics and make a deal. oufr guests this morning include mike jackson and also david zaslav. and the head of maris group.
6:02 am
and douglas holtz-eakin. >> let's talk about eurozone finance ministers meeting to discuss whether to release a new tranche of fund to go greece. the leaders are not expected it to okay the funding despite greece approving a tough 2013 budget. we'll have more from ross westgate in london on all of that. japan's economy shrank, first contraction since last year. the data adding to signs of slowing global growth and tensions with china nudging the which i into recession. and yen minute's main oil export pipeline shut after it was blown up in two pieces. local news organizations didn't identify the attackers, but they've been repeatedly sabotaged. finally, iran launched a military drill across half of the country today. government warning it would act
6:03 am
again against aggressors. >> where is your jacket? >> i decided in high spirit of rising above to take it off today. but i can't find my pin. >> i'm putting mine on right now. >> it's you saunderstood we're above. p. >> and you're about to talk about corporation news we haven't especially touched on petraeus. maybe we'll sneak that in. htc announcing a global patent settlement and ten year licensing agreement. the deal sends one of the first major conflict of the smartphone patent wars. apple sued accusing the company
6:04 am
of infringing on its technology. and citigroup will pay 15.5 million each to former ceo vehicle recomme vikram pandit reflectinging t t progress the coma. >> some of it was money that it already -- i thought the number was 6.6 smld what they actually gave him as an incentive fee. >> for leaving? >> well, that's the irony of it. >> going quietly maybe. >> he didn't go that quietly actually. he said it was his choice. he blamed everybody else. >> that's all boiler plate, isn't it? >> i guess so. >> so the jacket was deliberate. >> honestly i said to myself i don't have a pin today and maybe i will just not wear the jacket as a wave rising above. >> interesting.
6:05 am
>> mac even came over to hand me the jacket. >> i saw. >> deliberate. >> goldman sachs is in settlement talks over an $8.3 billion position that one of the traders had concealed five years ago. a settlement is expected in coming weeks. and i probably -- do i look different today? no? not really? >> did you get a haircut? >> no. i got power. last night. >> you got power. >> last night. >> like 11:00 last night? >> 11:00. >> so almost two full weeks you went without. >> two full week. but i'm gone you, the generac never wavered. >> you didn't have to fuel yours. >> change the oil a week in to it. you have to make sure because it's running constantly. but it is a -- it was like a lifesaver. >> and did you run everything in the house on it?
6:06 am
>> your heater, the door bell can ring, there's a -- >> dishwasher? >> dishwasher, tv. >> hair dryer? >> well, yeah. that's why i buought the thing. and washer and dryer. you didn't leave a bunch of lights on all around the house, but it's like night and day. >> part of the power outage without one, part with one. and such a difference. >> saw other people in the neighborhood being they look like that chtv show that you're going to start working. >> i talked to a woman that had a shower once. >> they look like the walking dead. walking slowly and they looked dead, they were cold, pale. it was a rough two weeks for people. >> especially because it was so cold. it got down into the 20s. trying to deal without power -- >> 27 degrees. >> it's one thing if you can get
6:07 am
to work and have heat, but if you're stuck in the house with a little kid, it was a rough too week. >> the mayor was leaving messages on everybody's machine said p & l were not returning his calls. so leaving us the number to call jersey central. and then finally yesterday all day long and then last night all of a sudden all this commotion, all these lights. at 9:00 at night, they're out there working in the full dark. if you shine a light on them, they -- >> it's been a rough two weeks for the workers. this was hazardous conditions trying to get things back up. >> there were anecdotal reports about sometimes they didn't know where they were going, so at noon they were sitting around. but you hear those things, too.
6:08 am
i know you like to be nice and saying they were working their ass off the whole time, but i don't know. it was hard. >> two weeks without power is back to chaos. >> the stone age. >> let's get a look at the global markets report. ross westgate is standing by in london. an ross, what can you tell us about how things are shaping up? >> pretty flat a where we stand right now. between morning to you. take a look at the dow jones stoxx 600. ftse and xetra dax after losses last week, this morning slightly firmer he. y you can see the chart. also want to along it can hang seng and nikkei. a couple bits out of asia. japan third quarter gdp down 0.9%.
6:09 am
better news out of china today. export growth after five month high up 11% for the month of october, maybe suggests the seven quarters of declining growth or weakening yoet ininan end. greece last night in a vote, greek parliament did pass the austerity budget. so eyes now on the eurozone finance minister's meeting in brussels. one would think there's nothing more for them to do apart from sign off the money because at the moment, at the end of the week, greece has to roll over 5 billion in t-bills. it ain't likely to happen today because they haven't read the troica report. no one thinks they won't get the money, but greece will try to raise nevertheless a t-bill auction to get that 5 billion just in case. but it could be fairly close. but no one expects it to be let
6:10 am
go accidentally by the end of the week. spanish bond yields in reaction to all of that, we are below 6%. but they are higher today. italian yields at the moment just over 5%, as well. that's where we stand. back to you. >> ross, thank you very much. i'm still thinking about all of your spy stuff. going to make me see the movie. haven't seen it yet. >> had a big weekend. >> it did. >> it got one star. >> no, it's bond movie. you have to go into it knowing it's a bond movie. but the opening ten minutes -- >> worth it. >> absolutely. >> do you ever wonder what your boss eats for breakfast or how the major ceo seems to be in two places at one time? cnbc and yahoo! finance are launching a special series called off the cuff. we hope to take you outside of the board room to show what you high impact leaders do when they're off the clock. every week we'll have corporate leaders who will be answering questions about what they like,
6:11 am
what they loath, what makes them get up in the morning and what inspires them. and what makes them the most proud. we start this morning with a man who is no stranger to squawk viewers. warren butch at the time. >> i start reading a couple papers and at the same time perhaps eating strawberry ice cream. >> oh, no. >> whatever it may be. cinnamon toast. whatever i feel like eating. if somebody is coming to see me, i put on a suit. if they rrparen't, khaki and a sweater. if i'm at home, i'm in a sweat suit. >> you ccan catch more by going to off the and coming up, china in the process of selecting its next generation of leaders, interesting piece, where did i see that? the first lady interesting photo of her. jik mcgregor knows the country very well. what the changes could mean.
6:12 am
6:13 am
6:14 am
welcome back. take a look at the u.s. equity futures. dow and s&p coming off their worst week since july 4th. you can see they are indicated higher, but maybe not the bounce you might have expected. the dow up 23.
6:15 am
>> squawk sports new, texans beating the bears 13-6. foster finished with 102 yards rush and touchdown catch and texans intercepted cutler twice before knocking him out with a concussion. >> no comment about the jets? >> they lost. >> andrew, here's the deal. >> did you see rex ryan -- >> the giants won the super bowl last year. a lot of people have told him he's fat and he should shut up. he's not fat anymore. she just shut up. but sanchez, you brush up against him and the ball goes flying out. >> they've been going back and forth. >> when the giants are the defending the super bowl champions and they got their butts kicked by the bengals and the other game unbelievable is
6:16 am
johnny football. texas a and m and alabama, that was unbelievable. alabama number one. texas a and m just joined the sec. and this guy johnny football, you just can't believe the last six minutes of that game. >> which means notre dame could be in the running. >> kansas state and oregon would be the ones that would go unless one of them loses. >> knocking off the leader. >> we'll see whether one of them loses. >> notre dame won. >> rutgers beat army. >> you didn't see a tweet from mike jackson who tweeted out saying rutgers may be head willed dowill willed down their way for a bowl game. >> toilet bowl. >> that's the same thing doug flutie said when i was in college. >> do they play football in
6:17 am
china? james mcgregor is here. the question of the morning, will the change in china's leadership change the way it it deals with the u.s. joining us now, jim mcgregor, author of the new book no aged wisdom, no followers. lessons from the front lines of doing business in china. no football, but the question is this leadership change going to impact our relationship with the country? >> china is in the same position we are. they have to do major reforms. they can't keep kicking the can down the road because they've built so much growth on government investment and loans from state banks. the state company, et cetera, that they have to build a consumer economy. they're in very frangile right now and i think that puts the u.s. in a better position because -- >> a better position to say
6:18 am
what? >> a better position to start enforcing trade laws against china. i've been in china 25 years and been involved with a lot of u.s. china relations, et cetera. and china has been playing games with the wto, playing games with our bilateral trading relationship. and this election was kind of a bellwether. people complain about china during elections, but this time the candidates agreed we should get tougher. >> mitt romney said he would label them a currency manipulator. given everything we're doing with the federal reserve, does that weaken the u.s. position in terms of currency manipulation? >> my view of currency manipulation, china has an array of industrial policies that are unfair. currency is this tiny slice over here. and so when washington only talks about currency, they're getting all with all the complicated stuff. and if you look at the currency, it's gone up about 20% in the last few years. so it's really not such a big issue anymore. >> is it piracy?
6:19 am
>> intellectual property,vil industrial policies that are aimed at the big multinationals' knowledge, making them partner with chinese state owned enterprise. and they are supposed to be a sosh a absorb and master that technology and compete overseas. >> do you think the obama administration will be emboldened to actually do something on the trade front only because they haven't -- during the election, that was not part of their argument, whereas becky was saying, romney was pushing the china issue on other things, as well. >> romney had harder rhetoric, but obama shifted in the middle of his term. he started out very soft on china, trying to be friendly, and china gave him nothing. so about halfway through his term, they started doing a lot stronger trade actions, filing some wto cases. and i think you'll see more and more of that. the u.s. chamber, everybody in washington is kind of geared up.
6:20 am
>> what about all the corruption reports in china. >> it's very serious. because it used to be don't ask don't tell, you can gather assets, but don't be it too public about it. >> will it have an impact on the leadership today? >> yes. these guys are under a rock right now. this information is getting out. the party has to regain credibility with the people right now. the people are pretty fed up despite -- what's fun any abony china, all the progress and people are not happy. >> we heard they've been trying to block all the reports from making their way anywhere. >> they block everything all the time and it gets through. the people who -- the policymakers, intellectuals, journalists, they get all this information. the opinion makers know this stuff. >> where are you you on themean
6:21 am
farther does it have to go? >> in the next sick monkxt six inyou'll see some stimulus, but also what should you look for is reforms. you look for reforms this banking, allowing smaller banks to get money to entrepreneurials. those are the things to watch. but the slowdown is real. the problem is they can't keep deficit spending their way out of it. >> but they're on their way back already. >> in a small way. >> the bottom is in? >> there are signs of that, but the problem is -- >> i was going to tell him will i love your tie. >> are you hip to the beatles or something? >> i used to an "wall street journal" reporter. when i started doing business, i decided i'd only wear strange ties. >> you know, they had a lot of
6:22 am
hair. there are stark differences between you you and the fcab four. is it an envy thing? >> yeah. >> but you were starting to say there are some signs that we've reached the bottom. >> manufacturing is turning around. the growth seems to be going up. you just never know what's underneath that. how much is the government goosing it and how much is real. >> you'll never get rid of that, right? >> what they need to do is emyou power private enterprises. 2006 on, they've strength thenned state enterprise and they're choking off the economy. private entrepreneurs are leaving the country. >> michelle showed us the report the other day of the game plan for china, about this high that's supposed to go through 2030. so the next 28 years or so -- 18 years, this is the plan they'll
6:23 am
be following. it showed them really moving away from a lot of the state enterprises and things. do you think that plan holds with this new leadership team? >> the question is whether china has the same kind of gridlock that the u.s. has had. because you've got a lot of people that have to give up positions, got to give up money. and might even be vulnerable for corruption charges if they lose their grip on policy. so when every had nothing, everybody was for reform. but now there's a lot of people with a lot of money that depend it on the current system. so the new leadership will have to really break through. they know this. they're very intelligent he'peo. it's whether they have the political will. you have to look at whether the new standing committee will actually work together because the last one it was every man for himself. >> gjim, we'll leave it there. thank you for being here this morning. when we come back, u.s. equity futures are indicating a
6:24 am
higher open on wall street. dow futures up by about 18 points. stocks trying to bounce back from their wofrst week in month. when we come back, we'll highlight the agenda items and stories that are most likely to drive today's session. ♪ [ female announcer ] today, it's not just about who lives in the white house,
6:25 am
it's about who lives in the yellow house, the green, and the apartment house, too. today we not only honor the oval office, but we honor the cubicle, and the home office as well. because today it's about all of us. and no matter who you are, you're the commander-in-chief of your own life. ♪ who have used androgel 1%, there's big news. presenting androgel 1.62%. both are used to treat men with low testosterone. androgel 1.62% is from the makers of the number one prescribed testosterone replacement therapy. it raises your testosterone levels, and... is concentrated, so you could use less gel. and with androgel 1.62%, you can save on your monthly prescription. [ male announcer ] dosing and application sites between these products differ. women and children should avoid contact with application sites.
6:26 am
discontinue androgel and call your doctor if you see unexpected signs of early puberty in a child, or, signs in a woman which may include changes in body hair or a large increase in acne, possibly due to accidental exposure. men with breast cancer or who have or might have prostate cancer, and women who are, or may become pregnant or are breast feeding should not use androgel. serious side effects include worsening of an enlarged prostate, possible increased risk of prostate cancer, lower sperm count, swelling of ankles, feet, or body, enlarged or painful breasts, problems breathing during sleep, and blood clots in the legs. tell your doctor about your medical conditions and medications, especially insulin, corticosteroids, or medicines to decrease blood clotting. talk to your doctor today about androgel 1.62% so you can use less gel. log on now to and you could pay as little as ten dollars a month for androgel 1.62%. what are you waiting for? this is big news.
6:27 am
well, having a ton of locations doesn't hurt. and my daughter loves the santa. oh, ah sir. that is a customer. let's not tell mom. [ male announcer ] break from the holiday stress. fedex office.
6:28 am
well come back to "squawk box" here on cnbc. i'm joe kernen along with becky quick and andrew ross sorkin. our top story, fiscal fears weighing heavily on investors minds. joining us is dave joy and jeff kilber. david, the recent, i don't know,
6:29 am
mini correction we've seen, buying opportunity or start of something more serious? >> i think it may be a buying opportunity ultimately, but i think it's too early to conclude that. in other words, i think it's an opportune time to be cautious. i would still take risk off the table. precisely because of the political uncertainty and most specifically fiscal cliff. there's a lot that could know wrong there still. but down road, if we get a framework for larger budgetary deal down the road, could be a catalyst for a better market. >> and i think there are bullish indicators here. despite the fact folks in washington continually drop the ball, there's a lot of pressure on them that you make it across the goal line. the treasury pits behind us we actually see like the low point of the range, the 159 we put out on friday. so right now there's no real rush to this treasury.
6:30 am
on top of that, we're seeing the vix under 20. so therefore i think we'll look at the next couple days here to see s&p really stay above the moving average. so pretty bullish. >> i can sort of think first hand about uncertainty and how it's not very positive. for example, for a while if the fed tells us they're keeping interest rates atyielding three four percent, but it makes a little bit of a cushion for these companies. but if we have no idea where dividend taxes are going to be, if they go to ordinary income, i can see how you might not be as bullish on the high yield stocks. is that something to take into account? >> ttit is. and the longer the uncertainty end is its, the greater the selling pressure. no reason to try to be a hero and get what politicians are going to do. so it take profits and rotate
6:31 am
out of them a little bit if it that's what you're comfortable doing. the other thing is make sure that if you want to hold on to them, you're doing it in the right kind of account. you roll it into a tax qualified account if you're able to do that and avoid the problem all togeth together. but because of the uncertainty, capital gains could go up, dividend taxes could go up, and historically we've seen selling pressure in anticipation of that. >> and even munis at this point. so firsthand you can sort of see the explosion that investors are trying to deal with. jeff, is europe sort of something that we look at after we look at our own problems? >> yeah, we have to get past the fiscal cliff. but the european situation, haven't said draghi in how long? so we'll see that come back in the forefront. draghi himself said they will do whatever it takes. just as the fed here came out and said that we will be in the
6:32 am
markets for how long no matter what it takes. so i really think the whole fed lay has been put on pause due to the fact of the uncertainty like the taxes and whatnot. but right now i think the risk-reward, if you get caught short in the market when somehow washington comes together, you could see a 5%, 10% move to the up side in the s&p and i don't think people who are sitting on cash will be that happy. and maybe december that happens, i'm not sure. but the point being you can't have the risk-reward to the wrong side here. >> consumer confidence is better. and housing is better. >> five year high. >> that's right. but at the same time, it's been a big bet made in this market to move into higher yielding instruments particularly bonds and low quality bonds. they could get hurt just as dividend hurts could get hurt if we didn't get a deal or timely deal. >> how about gold? >> i like gold. i really do like gold. we've talked about this. ever since we saw it go up to
6:33 am
1800, came down i think this is a buying opportunity. at the end of the day, bank of japan back into recession, maybe they never got out of recession, but at the end of the day, we'll see the global central bankers continue to debase their currency. therefore the inflation play at some point in time will be attractive attractive. i think gold is back on its way up here. >> do you think the same thing? >> i do, but i would watch operation twist. scheduled to expire in december. they've run out of short term bills to trade. what do they replace it with and does it expand the money supply to a greater extent. so i do like gold. but there is that little uncertainty with the fed next month. >> all right, gentlemen, the election is over. and still some uncertainty out there. but we will carry on. thanks. if you have any comments or questions about anything we've been talking about, when we come back, the weekend
6:34 am
winner at the box office. we'll talk about why the sky could be falling. plus the looming economic risks of the fiscal cliff. the nation's largest auto retailer tells us why washington's failure to come up with a solution could mean trouble on car lots. sfx- "sounds of african drum and flute" look who's back. again? it's embarrassing it's embarrassing!
6:35 am
we can see you carl. we can totally see you. come on you're better than this...all that prowling around. yeah, you're the king of the jungle. have you thought about going vegan carl? hahaha!! you know folks who save hundreds of dollars by switching to geico sure are happy. how happy are they jimmy? happier than antelope with night-vision goggles. nice! get happy. get geico. fifteen minutes could save you fifteen percent or more.
6:36 am
6:37 am
equity futures are up about 25 points or so. making headlines, sky fall, james bond taking in $87.8 million in ticket sales.
6:38 am
that's the biggest opening in the franchisee history. global sales for sky fall topped $518 million already. unbelievable. >> let's talk autos. and a little bit of the fiscal cliff. the risks of the u.s. going over the fiscal cliff, of course numerous including trouble for the consumer. good morning, mike. >> how are you? >> we're good. hope you had a good weekend. walk us through the permutations for you. if there's a fiscal cliff, what type of preparations are you making right now? >> our basic plan assumes that there will be some sort of grand bargain. so our forward orders are all based on that. all our marketing plans are based on that. if however the unthinkable happens and we go over the fiscal cliff, there are several
6:39 am
implications. from christmas to new year's feels like christmas every day to me. and if the country is transfixed looking at tee tering on on the fiscal cliff, that could be disruptive. and beyond that, if we actually go over the fiscal cliff, there's no question in my mind we'll have a recession. we will reduce orders to all the manufacturer, immediately begin to reduce inventory, be thankful that we have an investment grade balance sheet and we will stop hiring. >> so two issues here that i imagine we'll be confronting. one is if we go over and what overlooks like. are we over for a week or two weeks or months and is that the fiscal bungee cord we've talked about. or the other idea which you're talking about which is we may go over the cliff without going over the cliff. people may be sitting on their
6:40 am
hands come the next thanksgiving through christmas holiday shopping period because they don't know what's going to happen. >> it depends whether it plays out like the summer of last year, 2011, where that was extremely disruptive and harmful to the economy. >> so why have you not pulled back already then? >> people have the impression that washington, d.c. is dysfunctional and cannot resolve the great challenges that america has. and dysfunctional washington and cloud of uncertainty is hurting the whole economy. so the country wants to see particularly after this election that washington, d.c. can come together and solve problems. >> why have you not pulled back already? recognizing what you're saying, which is the uncertainty element even if it gets solved let's say by january 1st, it sounds to me like the uncertainty along the way will put you in a bunch of trouble. >> i believe the odds are much
6:41 am
greater that it will get resolved and it is going to get -- >> when are you betting for to be resolved by? >> i think the process of resolving it is going to be completely different than the summer of 2011. i think there was a lot of lessons learned there by both sides. we're past the election. everyone knows the only time you can govern reasonably in this country is after a presidential election. and if you look at the signals from the various sides, republicans are conceding that we'll have higher revenue and we'll have a more progressive tax -- >> what does that mean in terms of the luxury segment? you've done very well that's been one consistent patch along the way. and yet it appears whether tax rates themselves or at least effective tax rates are going up at least on the wealthiest, those who purchased some of the luxury vehicles. >> i think a comprehensive grand bargain that really shows that washington can solve problems and eliminate the cloud of
6:42 am
uncertainty over the economy will be far more beneficial than whatever difficulties are called by the higher revenue coming from the grand bargain. >> so little impact on your sales at the high end. >> long term if there's a grand bargain that includes higher revenue and more progressive tax system, so be it. i think that's the general feeling of everyone. so be it. get the deal done so we can all move forward with this economy. and rise above as cnbc says p. i'm ready to rise above. >> mike, why the ten days? i never knew that. it seems like there's snow everywhere. people buy them for their spouse and put a big bow on it? i never knew that. why are those ten days so important? >> there is a -- joe, it's basic american character. you work hard all year. you achieve a lot. your year end bonus is now determined. you know how you did.
6:43 am
you've celebrated with your family over thanksgiving and christmas. and you want to reward yourself and your family. and the manufacturers all buy into this, become self reinforcing. so the best availability and the best seasonal bargains of the entire year are between christmas and new year's. so it's self reinforcing and over the decades, we've created this year end ten day celebration and all you have to do is watch tv. like the political ads going into the election. and eithit's overwhelming but i works and i hope we don't throw it out the window this year. >> meike jackson, we'll leave i there. thanks for calling in. when we come back, we'll talk about the shipping indicator, what containers carrying everything from oil to toys can tell us about the global economy. ♪
6:44 am
[ engine revs ] ♪ [ male announcer ] oh what fun it is to ride. get the mercedes-benz on your wish list at the winter event going on now -- but hurry, the offer ends soon. [ santa ] ho, ho, ho! [ male announcer ] lease a 2013 e350 for $579 a month at your local mercedes-benz dealer. tdd#: 1-800-345-2550 after that, it's on to germany. tdd#: 1-800-345-2550 then tonight, i'm trading 9500 miles away in japan. tdd#: 1-800-345-2550 with the new global account from schwab, tdd#: 1-800-345-2550 i hunt down opportunities around the world tdd#: 1-800-345-2550 as if i'm right there. tdd#: 1-800-345-2550 and i'm in total control because i can trade tdd#: 1-800-345-2550 directly online in 12 markets in their local currencies. tdd#: 1-800-345-2550 i use their global research to get an edge. tdd#: 1-800-345-2550 their equity ratings show me how schwab tdd#: 1-800-345-2550 rates specific foreign stocks tdd#: 1-800-345-2550 based on things like fundamentals, momentum and risk.
6:45 am
tdd#: 1-800-345-2550 and i also have access to independent tdd#: 1-800-345-2550 firms like ned davis research tdd#: 1-800-345-2550 and economist intelligence unit. tdd#: 1-800-345-2550 plus, i can talk to their global specialists 24/7. tdd#: 1-800-345-2550 and trade in my global account commission-free tdd#: 1-800-345-2550 through march 2013. tdd#: 1-800-345-2550 best part... no jet lag. tdd#: 1-800-345-2550 call 1-866-506-9616 tdd#: 1-800-345-2550 and a global specialist tdd#: 1-800-345-2550 will help you get ted today.
6:46 am
6:47 am
welcome back. david faber is joining us with a breaking deal and some news. david, what have you got? >> good morning. you yeah, we got a deal in the financial services industry. jeffries, the investment bank with about 700 invest him ba-mv
6:48 am
bankers, getting bought by leucadia national. it will exchange 8.1 of its shares for each of jeffries. $17.60 a share for each jeffries share. the man who built jeffries will actually become the ceo of the combination before it's an all stock deal. and mr. hanler will be running the combination itself. roughly about 23 about% premium to jeffrey's closing price onfully. not friday. not a premium to its 52 week high. it's had its share of challenges, but having a very strong rear. leucadia for its part, said to be sort of like a mini berkshire hathaway.
6:49 am
a large investment company with stakes in mortgage services and things of that nature. it will be a much larger company hcht hanler will be running. but an important deal to jeffries. can't imagine there will be too much opposition given that leucadia owns 28.6 of jeffries and the two gentlemen who have been running it all of these years both on signature stakes, as well. cumming will step aside when the deal closes and the company's presented will become chairman. expecting to close the deal in the first quarter of next year.
6:50 am
23% premium. a bit of a premium to book value at jeffries. all stock transaction expected to close first quarter of 2013. expected to close first quarter of 2013. >> i remember as you do, david, a lot about jeffries. you said this is the gentleman that built it. i met and interviewed boyd jeffries with the steel blue eyes, i remember him, he ran into problems at one point. i remember a lot about it, he had an unbelievable house in la jol jolla. >> i remember that, your point is good one. built but perhaps reimagined, reinvigorated may be a better term. >> and mr. handler and what he had to go through in, when was that, dave, a year and a half already? >> about a year ago you're talking about when sean egan came out with the incendiary comments about a year or so ago. >> looks like it's going out at about double where it was at that point, but he's not really cashing in. and neither are shareholders
6:51 am
because they'll be able to participate in any upside with leucadia. >> that's exactly right. as i understand it, joe, as well, there's overlap in the two shareholder bases, so the fairholm or a blackrock may have stake in both which is a positive. there's an opportunity to participate should you does to do so. carl icahn came in a year ago on the weakness as you described as a result of some of that controversy. >> are you in your jammies? >> no, i put on my suit so i could feel more official, not quite my suit. >> david, if you need more details, they're now on dealbook if -- he's been working seriously listening to all of this stuff. if you forgot anything you just said. >> i assume as well it was
6:52 am
planning to be announced before the open of trading and i'm sure as a result of our reporting it at this point they'll put it out quickly. >> andrew just not back, sitting in the chairs. >> that's not true, david. >> typing furiously over there. >> that's a good scoop. it's a quality scoop. that is a real scoop in an environment where there are no deals, david brought us a very good scoop. >> that's why you haven't participated in any of this. there are no other deals. this was the only one. >> not many needles in the hay stack. >> david found the only one. thank you for bringing it here, david. boyd jeffries name. >> what was it exposure in europe? >> egan had all sorts of rhymes and reasons for that company falling apart. >> we'll talk about shipping right now, from i-phones to apparel, cnbc's senior talent producer, lori ann larocco, our
6:53 am
staff, incredible producer and her book "dynasties of the sea," and lori ann, reading through this, we know how important shipping is, we talk about it every day but there were things i didn't realize how much of the things in our homes are brought to us from ships. >> 92% of everything in a household has been on a ship and ever since superstorm sandy we've all realized how important shipping is as we're all going through this gasoline crisis. it's really amazing in terms of the wide breadth that the shipping industry has on the economy. >> we don't think about it all that often but as you mentioned sandy really brought that into focus. it's subject to the weather, a lot of the ships had to be diverted and it created all kinds of problems with all of us standing around on gas lines. just the idea of how the weather can impact these things, this has been an industry that hasn't changed all that drastically for
6:54 am
centuries, it's still bringing goods from across the ocean. >> it may have changed in terms of private equity and the traditional ship owners but shipping is shipping and what i find amazingly when you're looking at the shipping industry is that if you look inside those containers, if you see the quality of the product, the volume of the product that is going to a specific economy, it could actually be a good gauge for to you see if that economy is growing or not. >> what's it telling us right now about what we can expect for the holiday season, however the american consumer is doing? >> the american consumer is pretty much status quo. what a lot of the shipping owners are looking at now is the emerging economies. japan as they're weaning off nuclear power they're actually now consuming more american oil, so you're seeing more oil coming from the gulf to japan. and they're keeping barometers on that, looking at the philippines, looking at south africa, one ceo told me they're 50 to 70 years behind us.
6:55 am
it makes sense for them to invest in those economies so it's interesting to see as well as when you're looking at what we're exporting to china and what china is exporting to us. >> you did it with personalities, too. >> i did. >> that's the most fun. >> human drama. >> squashbucklers, they make a lot of money. everybody thinks it's an ari onassis, something like that. there's some romance involved with being in that business, plus you get so rich. >> they get very rich. john frederickson the world's largest ship owner, he makes onassis look like a small time guy. >> he does. >> and what's amazing from him is that he has given 50, i'm sorry, $15 billion in dividends in the last ten years to his investors. they're very focused on their employees. they go to employees' houses when the family members are kidnapped by pirates. they love what they do and the
6:56 am
romanticism compared to the traditional, it's amazing. >> some of the human stories but the pirates, interesting stories. shipping is not -- >> not for the feint of heart. you're around the globe everywhere in all corners of the earth. it's cool. romantic. >> lori ann the book is "dynasties of the sea" and it's available today. >> yes. >> we thank you very much for coming on and bringing this with us. we should also point out at 7:30 eastern time we'll talk with the head of global shipping maersk group. >> thank you. >> there's a bobcat. >> i know. >> don't give it away. >> it's called a tease. what do animals, cake baking, hoarding and scandalous affairs have in common? david zaslow will join us when we return. [ male announcer ] introducing the new dell xps 12.
6:57 am
6:58 am
part of a whole new line of tablets from dell. it's changing the conversation. ♪ well, having a ton of locations doesn't hurt. and my daughter loves the santa. oh, ah sir. that is a customer. let's not tell mom. [ male announcer ] break from the holiday stress. fedex office.
6:59 am
7:00 am
gaining growth and bucking the trend, discovery communications ceo david zaslov on keeping his company's financial momentum and the state of the media industry in the fiscal cliff face-off, he's our guest host this morning. what maersk is doing to get back in the black. and taking stock of your investments, a look ahead at what's on tap for wall street before the bell. the second hour of "squawk box" begins right now. good morning, welcome to
7:01 am
"squawk box" here on cnbc on this monday morning. i'm andrew ross sorkin along with joe kernen and becky quick. let's take a quick look at the futures see how the week is setting up after what was a roller coaster of a week. dow jones would open up 17 points higher, s&p and nasdaq would be higher as well. eurozone finance minister also likely not release a new round of international aid to greece at their meeting in brussels. greece passed an austerity budget sunday, two conditions necessary to get that aid, the ministers saying that another round of discussions will likely be necessary before aid is approved. it's now official, leucadia national buying jeffries group in a stock swap deal worth $3.7 billion, that story broken by david faber on "squawk," the deal represents a 23% premium for jeffries shareholders. hertz has agreed to concessions to get a hold of
7:02 am
dollar thrifty group. hertz agreed to leave a dozen locations at airports. the ftc deadline for approving or blocking the deal is friday. discovery communications with the number one non-fiction media company in the world with more than 1.7 billion subscribers in over 200 countries. since it began trading on the nasdaq in 2008 the company has delivered four consecutive years of double digit growth. president and ceo david zaslov is our guest host for the next two hours. he was around here for 20 years with us. >> 18 years. you and i started together and becky, too. >> you're one of the first people i met at a poker game, still don't know how to play poker and then we played golf. i don't know how to play poker, you don't know how to play golf. >> i'm getting better. >> you are. you knew the guy who started
7:03 am
discovery. >> john hendricks. >> he said you're really good and someday you can run my company so you have to earn your stripes. 18 years, you became an unbelievable executive, a huge part of our growth at cnbc people attribute it to zas. >> it was a great ride, tom welch, jock rogers. >> you cut deals. >> hold on a second. >> 18-year apprenticeship before you get to run the company. >> when i got to nbc in 1988 the broadcast business was everything and cable was losing money and the broadcasters weren't in the cable business so the idea that welch and wright said they wanted to be in the cable business, that was a big deal. >> i remember. it was too expensive to buy they thought to buy the existing property so they started kcnbc but there was an f&n and dow jones and westinghouse didn't
7:04 am
have the gonads to go forward with the deal. >> here is the true story we went up, it was tom rogers, myself and bob wright, went to see jack. we made a big presentation to say we should take over f&n and own the business news business. i was the guy that was basically holding the papers and i was supposed to go ahead and talk about the internal rate of return was and how many years before we break even and got about 15 minutes into it and jack goes "time-out. there's two questions you have to answer. is business news a business?" cnn was losing money. nobody was making money in the cable business at that time. is it a business and can we own it? there was real concern at that time that ted turner had cnn and headline news. we could buy f&n and turner could turn headline news into a business news channel. >> to compete. >> so it was great for me to see
7:05 am
that. >> jack made the decision to do it. >> jack and bob basically said we believe in this, and then it didn't work for a lot of years. this was a great lesson to me. the cable business is really tough. if you can build a niche and get an audience to spend time with you, people still watch eight to ten minutes. it seems easy. we hung around with cnbc after that fnn acquisition we lost money for another four years. there was a moment that we went up to a presentation with welch, and we had lost so much money at cnbc and all of the nbc crew was against us. they were great guys fut people believed in cable at that time and the head of entertainment turned in one of the meetings and said for the amount of money we lose at cnbc every year we could have done three more pilots. that was the culture. when nbc finally was sold to
7:06 am
comcast, 85% of the business, 85% of nbc universal was cable. >> i remember the day cnbc turned the corner in that was when "squawk box" began, wasn't it 1990 -- isn't that the day you remember? >> i do remember there was this confrontation with joey. he never really fit in a box, and in the beginning we had, the idea was we were going to be serious and just give the news and we all know joe is not serious. every time he would go off script he would get yelled at. "every time i go off script they tell me i have to read the prompter." we had a lot of discussions and said forget it, you got to be yourself. that's what made cnbc successful, we decommoditized. they love maria, they love
7:07 am
becky, they love you, who you are. >> i don't know how it fits together but they've been around the entire time and not to disparage them but they never did become decommoditized. >> the biggest takeaway through the tough time, cnbc, msnbc, bravo, even through the acquisition of universal was if you believe you have a brand that people want to spend time with then you have to find the right recipe so that was true for us with own. we took a lot of heat with oprah. all along i said listen, i don't care you who are, oprah is maybe the biggest star on the planet, she has unbelievable talent and drive but you can't just flip a switch and have a cable channel that's successful. it's almost two years later and there is no cable network that was successful in less than two or three years. we're finding real success now but you have to stay calm, as we did in those early days and if
7:08 am
you believe, continue to invest but listen to the audience, the audience will always tell you. they need to spend more time with you to be successful. >> how nervous were you on own? >> i really wasn't. we had oprah winfrey, we had over 80 million homes and i just know these things take time. if you look at fox news, the first two years, they had to find their recipe, almost no one watched them. when we got bravo the only show that was working on bravo was "inside the actor's studio." little by little we built it. when i got to discovery, tlc was the number 25 network in america. today it's a top five channel. it took a couple of years. you have to build a good creative team and really back them and spend more money, more money on content. >> what are you hearing from the audience when it comes to own and what have you done differently? >> too preachy, too teachy and
7:09 am
earnest when we came out and it's something oprah and i talked a lot about. we needed more fun and energy, oprah needed to be on more often. oprah came on the network in the beginning of january and we had been on the air already for almost a year. >> she wishes she would have been on from the get-go. >> even if she was, it still would have taken. you have to make your mistakes, your stumbles, learn from it and move forward. when oprah is on own, we're usually a top five network in america, we also have "sweetie pies" a lot of talk characters during the day but the length of view is about 90 minutes so people are spending a lot of time with it. >> that's so important. >> the network is one of the fastest growing cable networks in america. >> that was going to be my question it's a pure cable play which you'd like to have because of the dual revenue stream but it's difficult to be in cable
7:10 am
channel play if all your channels stink. if you do, then you have something and it becomes international now, that's what you're doing. >> when i got to discovery we had 13 channels in the u.s. and six channels in 00 countries around the world. we were the number one platform media company in the world, more channels than viacom and time warner. we had one great channel, discovery and the mission we've gone on over the last six years is to become a great content company. today we make over $2.1 billion of our 13 channels we started investing about $500 million in content. this year we invested over $1 billion but our market share is almost 10%. >> from 4. >> and our content works around the world so when you look at
7:11 am
discovery, science, animal planet, investigation discovery, we took that content around the world, so this year we'll make more money outside the u.s. than we did as an entire company five years ago. >> you invested in content. why were cable operators so scared? for so many channels for so many years, bravo or what have you, it was a repeat business, just buying content that had already been and repurposing it. five, six, seven years ago people decided we have to change the game. >> there's two ways to make money, one is to cut costs, streamline your business and figure out where you spend your dollars to be more efficient. we did that at discovery our first two or three years, reduce our costs everywhere in the company so we could spend more on the screen. there's no way the growth in the cable business and we're a pure play cable company, that's basically all we own all over the world, there's no way that we can grow without better
7:12 am
product, better stories and better characters. you have to invest more in content and if you take a look at us our strategy really is different in two ways than any other media company. number one, joe, is we're global. we make more money in our cable business outside the u.s. than any media company in the world. later on we're going to meet with emilio from televisa, he's in mexico. in mexico we have 13 channels, we've been there for 20 years. for us, our content works well around the world and we have this international advantage versus other media companies, number one. number two, we are still believers. in the last six years we've invested in seven new channels, that's more new channels than all the media companies in the u.s. put tokt so we still believe if you take a brand like we did with i.d., we have this channel investigation discovery, it's now a top ten network in america. it didn't exist four years ago. it is, i.d. is the fastest
7:13 am
growing cable network in america for three straight years. >> we have to take a break, but i know that knowing you and i've asked you how you come up with this stuff, you have great people coming up with it, it's not all you. but did they say we want to put "honey boo boo," when is she -- >> she's not coming. she's in school today. >> at the same time you did give the go ahead for "honey b boo boo." >> i love that show. >> you got to say that. it's part of a strategy, joe. tlc is one of the top five networks in america for women. >> listen to you telling me -- >> here is the strategy. you can appreciate this. this is the same strategy as your party. this is your party strategy. what was our strategy for tlc? a ton of networks focused on new york and l.a., stars, big personalities getting written up in the "new york times" and
7:14 am
"l.a. times." tlc is from our perspective we don't care if anyone in new york or l.a. watches. we are middle america, so people laugh when we put a show on, we're real america. people laugh when we put a show on about home schooling. show on home schooling. we have a show on pageants. this is the strategy of the republican party. america is not new york and l.a., joe. >> don't point at me when you say that. >> david will be with us for the rest of the program. we have a lot to talk to him about. futures are indicated higher, dow up by 21 points, s&p by 2.8. we'll get an update on the week ahead after the break and later the shipping industry has seen pressure on freight rates and shipping capacity. we will hit the high seas with the ceo of global shipping giant maersk. "squawk box" will be right back.
7:15 am
comments? questions? send them to @squawkcnbc on twitter, follow the show and look for updates from andrew, becky, joe and the "squawk" staff. "squawk box" on cnbc and twitter. for 30 some years at many different park service units across the united states. the only time i've ever had a break is when i was on maternity leave. i have retired from doing this one thing that i loved. now, i'm going to be able to have the time to explore something different. it's like another chapter.
7:16 am
7:17 am
7:18 am
if congress fails to agree on a budget americans will see an average increase of 5% in federal income taxes. the stock market coming off its worst week in five months amid some growing concerns about the fiscal cliff. joining us is peter bookvar. you've been writing a lot about the fiscal cliff and what it might mean down the road. first of all, do you think we've come to a solution and if not, what happens to the economy? >> well i think we come to a deal but there's this perception as long as you get a deal, everything is going to be fine. i'm of the opinion if you get a deal it's a bad one. in december the market will have its own dynamic and will cheer a deal but in 2013 we have to deal with the economic consequences of it. >> what is a bad deal, by that we don't tackle some of the entitlements, don't deal with the bigger fiscal abyss? >> the argument about just raising taxes on the higher income is a financial red
7:19 am
herring when you have trillion-dollar deficits. it all comes down to the entitlements. you fix the entitlements, control the rate of spending and all of this goes away. the u.s. economy is barely growing 2%, europe is in a deep recession, so by raising taxes to any extent will send the u.s. economy into recession in 2013 and therefore you'll be getting a lot less revenue than you thought. >> peter, i like so many people after the election, is the old annalogy when the dog catches te bus, sometimes you wish you hadn't caught it. now what do i do with it and i've thought that we may finally get an answer on reinhardt rogoff and find out whether policies really do matter. i don't want to find out the wrong way. $82 billion, if we do it on $1 million and off, and if it was only on $1 million and above it's less and that's all i'm hearing from the obama
7:20 am
administration peter at this point, is that high end thing. that doesn't solve anything at this point. >> right. raising tax rates and saying that's the only way to get revenue is a false choice. all we need to do is grow the economy more than it is today and you will get higher revenues. that's the simple math and again, the context of where we're going with these tax hikes is the u.s. economy is barely growing and why would we want to damage that? why do we want to shrink the private sector just as the time we need to increase it. >> they point out the president, when he signed the last compromise when he did the two-year extension he said it's not the right time to raise taxes. they do understand it can be below 250, more deleterious because people above 250 don't save it or they spend it. they understand it's not good for the economy. the $82 billion we were able to get might hurt the economy to
7:21 am
the same extent we'll still be at $1 trillion and at $20 trillion within four or five years. >> last week we talked to david rosenberg pointed out he doesn't think we'll be at a point where in the next five years it won't be a good time to raise taxes. >> growing the economy raises revenue. raising tax rates doesn't necessarily do that as we see in europe. spain, greece, italy, portugal, they're all raising tax rates whether it's income tax rates, valuated tax and revenues are coming in below expectations. our problem comes down to three things, medicare, medicaid, social security. you cure that, this is all over with. >> what is the drag on the economy if you went a million bucks and above? >> are you talking just income or income and capital dividends gains in. >> let's do both for kicks. >> you'll immediately drag into 2012 a lot of decisions in selling assets to try to capture
7:22 am
revenue or gains in 2012. raising revenue over $1 million may not have that much of an impact but you'll barely grow revenues anyway. what is the difference? it's a red herring when you have trillion-dollar deficits. >> you hear what bill crystal said over the weekends, they're not talking about tax rates but effective tax rates is what ends up happening. >> you know you say red herring but warren buffett will say this is more of a situation of the appearance of fairness. you can cut entitlements if you raise some of the taxes on the higher end so it becomes more of a fair deal and the public looks at it more fairly. >> you look at the entitlements. we have to create a situation where spending is not going up 5% to 8% in medicare, with he know all of the baby boomers are retiring. the system is broken.
7:23 am
we've made promises that we cannot keep. >> no argument on that. no argument on that. is there a way to do it by saying maybe you cut some of the loopholes, find a more progressive tax code, more progressive than now and that's the way you cut the deal so you can cut the entitlements? >> maybe cosmetically you can make it nice. when it gets down to the numbers it's not going to make much of a difference. >> everybody agrees if we can broaden the base. there are so many big dollars that are just out of the way of being able to be taxed, wherever you want to find it. we need to broaden the base and get at some of that, if we could get at it broadening the base that would help and everybody thinks that would help economic growth and that would satisfy the idea that we're raising taxes and we are raising revenue if we did it that way. that would work but we're not hearing that from president obama. he's still talking about rates. >> imagine the revenue explosion in federal government if you do
7:24 am
3.5% to 1.5%. simple as all that. >> peter, thank you. >> thank you. coming up, the ceo of televisa. time for today's aflac trivia question. on this day in 1993, the top song of the billboard hot 100 list was "i'd do anything for love" by michael lee aday, better known by what name? the answer when cnbc's "squawk box" continues. huh! no! who's gonna help cover the holes in their plans? aflac! quack! like medical bills they don't pay for? aflac! or help pay the mortgage? quack! or child care? quack! aflaaac! and everyday expenses? huh?! blurlbrlblrlbr!!! [ thlurp! ] aflac! [ male announcer ] help your family stay afloat at plegh!
7:25 am
is what drives us to broadcast the world's biggest events in 3d, or live to your seat high above the atlantic ocean. it's what drives us to create eco-friendly race tracks, batteries that power tomorrow's cars, nearly indestructible laptops, and the sustainable smart towns of the future. at panasonic, we're driven to make what matters most better. just another way we're engineering a better world for you. i always wait until the last minute.
7:26 am
can i still ship a gift in time for christmas? yeah, sure you can. great. where's your gift? uh... whew. [ male announcer ] break from the holiday stress. ship fedex express by december 22nd for christmas delivery. three words dad, e-trade financial consultants. they'll hook you up with a solid plan. wa-- wa-- wait a minute; bobby? bobby! what are you doing man? i'm speed dating! [ male announcer ] get investing advice
7:27 am
for your family at e-trade. now the answer to today's aflac trivia question, on this day in 1993, the top song on the billboard 100 list was "i'd do anything for love" by michael lee aday, better known by what name? the answer, meatloaf. >> i got that one right. coming up next we've got shipping giant maersk talking about business on the high seas and global economy. and coming up susan lucci will join us here on "squawk."
7:28 am
sfx- "sounds of african drum and flute" look who's back. again? it's embarrassing it's embarrassing! we can see you carl. we can totally see you. come on you're better than this...all that prowling around. yeah, you're the king of the jungle. have you thought about going vegan carl? hahaha!! you know folks who save hundreds of dollars by switching to geico sure are happy. how happy are they jimmy? happier than antelope with night-vision goggles. nice! get happy. get geico. fifteen minutes could save you fifteen percent or more. time for citi price rewind. because your daughter really wants that pink castle thing. and you really don't want to pay more than you have to. only citi price rewind automatically searches for the lowest price. and if it finds one, you get refunded the difference. just use your citi card
7:29 am
and register your purchase online. have a super sparkly day! ok. [ male announcer ] now all you need is a magic carriage. citi price rewind. buy now. save later.
7:30 am
welcome back to "squawk box"
7:31 am
everyone. in our headline this is monday morning, republicans and democrats making the rounds on the sunday talk shows sounding optimistic notes on striking a deal to avoid the so-called fiscal cliff. that could help wall street's mood with the dow and s&p 500 coming off their biggest weekly losses in five months. lot of that was because of the fiscal cliff related worries. also toys "r" us and target say they will start black friday on thursday, on thanksgiving day itself. toys "r" us will open its stores at 8:00 p.m. on thanksgiving night, target will open at 9:00 p.m., that caused some controversy last time around but obviously worked, that's why the retailers are jumping on board. htc and apple settled a two and a half-year-old patent dispute. their agreement to cover current and future smartphone patents. the original dispute centered on google's android operating system. our guest host is david zaslav.
7:32 am
we've talked about the fiscal cliff, asking ceos what they think about the entire situation. what does it mean for discovery? >> first for us we need stability. the fact that things are up for grabs is a bad thing. the fact that you really hear a lot of discussion of coming together, however this is going to be resolved it has to be introxhiz which hopefully will get done before the end of the year and if we have certainty we have a strong advertising market domestic domestically, around the world things are good except for western europe. clearly the economy is not going to pick up dramatically in western europe but with real uncertainty here in the u.s. all of us on the business side are going to be holding back. >> you don't think advertising softens? people say it seems to be softening up a little bit. >> for us it softened up in october. it's come back pretty good for us. >> how did is soften? >> in volume, we just couldn't, i think across the board we saw
7:33 am
some meaningful softness. having said that we posted about 7% growth last quarter in the u.s., and double digit outside the u.s. but this quarter looks quite good. we've said that we'll be high single digit in the u.s. and outside the u.s. we'll be more than mid teens and we have a fair amount of visibility right now and the advertising market is strong. we have to get out of our own way and the way to get out of our own way is get our house in order. we only spend what we can and the country has to start living the same way we all do. it feels like we're moving in that direction which is encouraging. >> if you were assigned to fix the network business, the network business still delivers numbers that can only be delivered by a network with super bowl or olympics or whatever. could you, do you know what to do with the network business or are you just happy you're getting all the, you know, everything that's falling from the -- i mean -- >> the network business in the u.s., we're going to talk to emilio, who runs the equivalent
7:34 am
of nbc, abc and cbs combined in mexico, fantastic guy and great creative leader, there's nobody better in this business than what les has done at cbs and steve burke doing a great job at nbc universal and bob eiger. you have great people running the broadcast networks, facing an issue, viewership is changing and this is where i think it's an advantage for us. people watch broadcast networks for shows and people watch cable networks because they like the brand and they feel that that channels where they want to hang around. discovery on friday night we're the number one network in america for men. we even beat the broadcasters with "gold rush" and "jungle gold." if you ask people why they turn to discovery they get home, have dinner with their kids and then what do they want to watch? they don't turn to us for a show, they turn to us because they feel like that's my
7:35 am
channel, same for tlc, on friday nights with women, we're number one and we're also number one on sunday nights with women. if you ask our audience, when you watch tlc, name the shows you're watching. they can name only one or two, and so the cable business has this great trend of viewership. people moved away from wanting to watch broadcast networks except for the great shows. >> why can't the networks create the brand identity you're talking about? >> because the networks are broad. the closest to that is les and les gave us the pearl of our idea for i.d. it was a great programmer, he's still involved in the creative process in a way that's really amazingly impressive, number one network but they're basically a crime and investigation network. if you look at most of what les was doing, great comedy. >> the ncis franchise. >> all of that stuff, "hawaii
7:36 am
five-o" "ncis." cbs is the number one channel in america and scripted crime and investigation. that's how we said what if we're non-scripted crime and investigation. is there room to build a cable channel around that? four years ago we launched i.d. it's now a top ten network in america and it was so successful here it's a top five channel in the u.s. during the day, we're going to have susan lucci on but we're taking it around the world. >> remember when court tv turned it to tru, and trying to do crime, same thing but you succeeded and they didn't or haven't succeeded to the same extent. >> i think court tv did fine. we hired a great creative leader, henry schleif, be measured in our investment until we figure out what the formula is and when we find our audience and know that we can create content that nourishes them, we plow in with more dollars and that's what we've done with i.d.
7:37 am
>> we'll talk to maersk now. are you ready? >> i'm ready to go, shipping. >> world's largest container shipper and oil group, maersk saw third quarter profit jump 191% as its container rates and other core businesses improved. joining us live from copenhagen to give us a global economic outlook is the ceonils anderson. thanks for joining us. we appreciate it. can you go over the last year or so and stop where we are right now in terms of if you can global economic activity as seen by you? >> well, i think we've gone through, all the economies will testified through a period of great turbulence and you can say from a european standpoint there's still quite a bit of turbulence and political uncertainty but i guess the reality is we are getting through that period. we're seeing the u.s. is coming
7:38 am
back growth wise, we're seeing china becoming more sort of precise in where they intend to go growth wise. we still see good development in most of the growth markets around the world, so i think we are coming through to a phase where we can say probably within the next seven, eight months we'll see improvements and for our business we'll see improvements from the middle of the next year, when we meet the relatively weak or the very weak trading figures we saw in the second half of 2012, so we are cautiously optimistic that we past the worst and we continue to invest heavily in growth markets and so on. so we are i would say compared to many economists and what we hear, we're relatively optimistic for the global economy. >> i guess you, the size of the u.s. market would dictate you have to pay attention to what goes on here domestically. when you look at all these machinations that we have with the fiscal cliff, i guess even
7:39 am
in denmark you're used to politicians, too, but do you shake your head and just hope for the best? >> i don't know whether you can just hope for the best, but i think the underlying trends now in the u.s. economy, you've gone through a lot of de-leveraging and i think the labor market is doing better, the housing market is doing better, so for sure we're aware of the issue of the fiscal cliff but we just think the underlying fundamentals should at least help you through that period without too much of a setback, and then we tend often to sort of look at just the two big mature economies including japan, with europe, u.s. and japan we are mature economies and we'll come through periods of slow growth but we shouldn't forget that once the developing markets pass certain hurdles, they will also start importing quite a bit of high
7:40 am
value consumer goods and so on. we see that in china now, we see good trends in the import figures, we hear from the political leaders they want to make china more of a domestic consumption country than it has been in the past, so i think we'll see that the advanced economies, if i may say so, if they're reasonably competitive, we get a lot of opportunities from the developments out there. >> nils, i saw a light bulb go off in david zaslav's head. i think he's thinking life on a big tanker ship must -- i don't know what he's going to ask you, but is that -- >> i was going to ask about the advertising market that we're seeing in your region has remained pretty good. what do you think of the advertising market over the next couple of months and what are you seeing on the ground? >> what market, sorry, i didn't get that. >> spending dollars to grow market share in the advertising
7:41 am
markets in your region, what are you seeing? >> i think basically if we take europe as our region it's very hard to see a lot of light short term in the consumer markets. we have, i mean, people say it's lack of spending but the reality is that we have an overleverage of the public sector, we have a lot of private consumers who i think rightfully so are cautious on what they spend on, so it's maybe a good time to take market share away from your competitors but i think the consumption environment will remain quite subdued for a little while yet. >> nils, i just can't resist, the fat tax. did you see when it was put in, and you see that it didn't work. i mean, your politicians, we have a crazy one here that did it with sodas. that just, can we just take it off the table now that this kind of social engineering does not work? if denmark can't make it work, then i don't know who can.
7:42 am
>> i think what has happened with the fat tax is that it just is extremely complicated to administer. it forces people to shop south of the border in germany, that doesn't have the tax taken makes people change habits. so it's just another way of taxing people and unfortunately this tax is also a tax for those who can least afford to pay more. it was an unfortunate attempt and fortunately it's removed now so it was i would say just another way of getting money out of the danes' pockets. so it's good to see it gone. >> very good. thanks for playing along on that subject as well, nils. we appreciate your time this afternoon for you, this morning for us. coming up, more from guest host david zaslav who if i were that guy, you don't think life on a tankership is interesting enough?
7:43 am
>> "deadliest catch" shipping in the bering sea. >> are you sure, pirates -- >> we'll stay in the television business. >> that's whey meant. groupo te elevisa, we'll speak to one of mexico's richest men when "squawk box" continues. on this episode of "squawk box," daytime's leading lady, a member of the broadcasting hall of fame, icon, businesswoman and host of investigation discovery's prime time show "deadly affairs" susan lucci talks tv success and business endeavors, right here on "squawk box."
7:44 am
7:45 am
ally bank. why they have a raise your rate cd. tonight our guest, thomas sargent. nobel laureate in economics, and one of the most cited economists in the world.
7:46 am
professor sargent, can you tell me what cd rates will be in two years? no. if he can't, no one can. that's why ally has a raise your rate cd. ally bank. your money needs an ally. "squawk" is back been with more than 3.5 million subscribers and controlling four of the biggest broadcasters in mexico, the largest network in the world, abc, cbs, nbc combined? >> equivalent of those combined plus they own the equivalent of
7:47 am
directv and a major cable operator and a great group of guys. emilio -- >> i'm not going to comment about the anti-trust piece of this. joining us about the latin american america emilio escarraga. >> thank you for having me join you this morning. >> things were a little bit soft in october but may have gotten better in the u.s. how are you seeing the market in mexico and globally? >> well, mexico has done a great job managing their economic situation. in a country with ours with the worldwide crisis that happened and the way jex mexico has been evolving, growth 3% every year, makes good numbers against the crisis in spain, italy, france and all of europe and actually
7:48 am
the deceleration in the united states. so i believe that mexico has proven to be good numbers. it's in the case of the advertising market it's pretty much we've seen a lot of growth in pay television subscribers in the platforms that we have and that the competition has so that throws you numbers that people are good and they have the money to spend in those kind of things, so i believe that we foresee in the next few years a bright future for mexico and the spanish speaking market in the u.s. has been growing for the last ten years and we've seen not just the amount of people in the united states but also the economic possibilities that they have. >> emilio we have david here, the zas. >> emilio good to see you. >> david good to see you. >> the point about mexico what gets us so excited. we have 13 channels there but
7:49 am
mexico is still only about 45% penetrated for cable. the u.s. is over 90% so it's way underindexed and that gives an opportunity for the next several years for growth and you saw it this year. in mexico there was almost 2 million subscriber this is year. that's more than the new subscribers in the u.s. over the last five years combined. one of the things that's made us successful, we're there for 20 years, televisa has been a great partner, they carry our 13 channels on their cablevision, on their sky platform, directv, and they work with the programmers there to try and create a win/win and mexico is one of our best markets. >> emilio, real quick, david is on the board of univision. you have a stake in univision. will they make money on that deal eventually? >> i definitely believe that univision can be a great business. we started univision back in the '60s. since then we have believed that
7:50 am
the spanish speaking market in the u.s. is a very important market and now you see the numbers that they have, when you see a population of more than 55 and growing at the rate it's growing, i believe there's an important room for univision to make business and obviously you see the numbers it's making, so i definitely believe that it's a deal that is going to be a good deal for all the partners. we have coming in the last couple of years and the way we have worked in creating new content and producing new content and finding ways with management to see we take up sales better, i believe that the work in the television and univision can do together will be great. i believe univision is a long-term investment and i believe it's going to end up good. >> you got in at a good time. how much do you worry about your business being disintermediateiated by the internet and broadband.
7:51 am
i don't know what the penetration is like down in mexico and south america. >> penetration of internet and in mexico, latin america is still very low but we're working a lot in creating new content. we are not just a brx platform through pay television and over the air but we are a large producer, we produce close to 65,000 hours of television programming per year and that's for pay television and over the year and obviously we're starting to produce a lot of things for internet. i believe that the multiscreens are already here and we need to be prepared for that. also we need to not just create programs but we have a strategy called 360 that's basically not just create a program but producing the program and build around the program a lot of things that you can do either music, live entertainment, obviously internet, applications, video games, so i believe that that strategy can
7:52 am
help us be in all of the different distribution platforms and obviously compliment each of the screens, compliment the other ones. it's like when television started, they said that movie was going to die and radio, and what i believe is that it's the confluence of all the screens and obviously being prepared for the different audience because it's not the same audience that's in the pay television and internet. >> we have to leave it there. just to go make money onner xh es commercials ourselves. it's a great conversation. we'd love to have you back. >> good to see you emilio. >> ghood to see you, david, bye-bye. >> looking at the futures, you'll see right -- >> kyle, uh-oh. >> you were supposed to take me higher, no the him. futures are up about 31 points. s&p futures trying to get it higher as well. at the top of the hour, has the strength of the u.s. economy
7:53 am
been underestimated. we'll talk to a fund manager who says instead of worrying, learn to love the fiscal cliff. "squawk" will be back after a quick break. trading tools for all.ul look at these streaming charts! they're totally customizable and they let you visualize what might happen next. that's genius! strategies, chains, positions. we put 'em all on one screen! could we make placing a trade any easier? mmmm...could we? open an account today and get a free 13-month e ibd™ subscription when you call 1-888-280-0149 now. optionsxpress by charles schwab.
7:54 am
7:55 am
♪ welcome to the jungle, we got fun and games ♪ ♪ we got everything you want the new york jets doing the improbable by playing two games yesterday, the first in cincinnati, new york teams, the second in seattle, actually my beloved bengals beat up the
7:56 am
defending super bowl champs yesterday who looked a lot like the jets, i guess that was the joke. they looked like the jets playing twice. this was, yeah, cincinnati took advantage of a fumble and two interceptions to beat the giants 31-13. andy dalton is really good. threw for under 200 yards but four touchdowns, first time he's done that, including one to a former rutgers star. do you remember this guy, mohammed san snu. >> i do. >> we should point out the giants last year were it's not look they looked like super bowl champions until they peaked in the playoffs so there's still time. for the jets, i don't know. >> no. >> you don't know? >> i do. >> when, do you ever see tebow in more than -- >> yesterday he played. >> but i would have put him in and left them just to see what can happen. >> that was the argument. when we return we'll hear from a fund manager who says investors should embrace the
7:57 am
fiscal cliff and the woman who defined daytime drama, susan lucci is our special guest, with he'll talk about her new show on discovery and much more, when we return. having you ship my gifts couldn't be easier. well, having a ton of locations doesn't hurt. and my daughter loves the santa. oh, ah sir. that is a customer. let's not tell mom. [ male announcer ] break from the holiday stress. fedex office. you won't just find us online, you'll also find us in person, with dedicated support teams at over 500 branches nationwide. so when you call or visit, you can ask for a name you know. because personal service starts with a real person. [ rodger ] at scottrade, seven dollar trades are just the start.
7:58 am
our support teams are nearby, ready to help. it's no wonder so many investors are saying... [ all ] i'm with scottrade. part of a whole new line of tablets from dell. it's changing the conversation. ♪ monarch of marketing analysis. with the ability to improve roi through seo all by cob. and from national. because only national lets you choose any car in the aisle... and go. you can even take a full-size or above, and still pay the mid-size price. i'm going b-i-g. [ male announcer ] good choice business pro. good choice. go national. go like a pro.
7:59 am
8:00 am
previously on "squawk box," joe and andrew formed an alliance on a deficit deal. >> even with andrew we agree now. >> can their relationship survive tough political negotiations? will washington rise above partisan bickering to get a deal? or will the debt disaster lea to the biggest fiscal cliff hanger of all time. >> ooh, ooh, is it something i said? >> and what will happen when we unleash wild animals on the "squawk" set? susan lucci guest stars on the special episode of "squawk box." >> hi, i'm susan lucci and "squawk box" begins right now. ♪ >> we have time to run that again, don't we? welcome back to "squawk box" here on cnbc, first in business worldwide. i'm joe kernen along with becky quick and andrew ross sorkin.
8:01 am
our guest host, he brought friends, david zaslav, president and ceo of discovery communications. i don't think i've seen a tie since he became ceo of discovery. that's a cool thing. zucker, too. the minute these guys get there. >> it's a sign you have arrived. >> i don't know about that. definitely more comfortable. >> no one is going to tell me whether i should or shouldn't. he brought some friends with her, "all my children" star susan lucci, host of investigation discovery's "deadly affairs." at the bottom of the hour, markets, the economy and the fiscal cliff with a bobcat, a porcupine and a mini crocodile. >> i don't think the bobcat likes the cameras. get away from me. >> you know the difference between a porcupine and a porsche ownowner, don't you? >> i do and i'm not going to
8:02 am
tell you the answer. eurozone not releasing international aid to greece. greece passed an austerity budget late sunday and reform package last week, two conditions necessary to get the aid. ministers say another round of discussions will likely be necessary before aid is approved. we've got a deal on a monday morning, leucadia national buying jeffries group in a stock swap deal worth about $3.7 billion. david faber broke the news earlier this morning. the deal represents a roughly 23% premium for jeffries shareholders. let's talk apple and htc announcing a patent settlement. specific terms were not disclosed. the deal ends one of the first major conflicts of the smartphone wars. we'll see what happens if they can ever get a deal with samsung. quick check on the markets we'll open up with green arrows after what seemed to be a wild week. dow would open up higher as
8:03 am
would the s&p 500 and the nasdaq. let's go across the pond to see what happened in asia overnight, hang seng up at 45.92 and shanghai composite up, nikkei and korea is down. ftse is up, cac down and the nasdaq up. i don't know what we'll make of that. our guest host today is david zaslav, president and ceo of discovery communications. david you've talked about how people have moved away from broadcast and cable in particular, discovery has really been able to make the most of that by creating the special nichz for them, places where they want to go, men want to see one thing, women want to see another thing, but i've watched what is happening with younger americans and it seems to me that younger kids watch less and less television. they are more interested in being on the internet and doing other things. how do you change that behavior and get them to migrate back to television screens? >> first it's hard to tell
8:04 am
what's really going and there's a lot of cross data. i agree with you, that you look around and you see that younger people seem to be consuming content on other platforms. having said that, people are watching more tv right now than they ever have in america, since the olympics, when we came out with some of our new programming across our 13 networks we've grown 8%, in october we grew 17% in terms of market share, and we've grown each of the successive last four years significantly for each of our channels and so on the one hand, we sort of, we break our company in half. one is forget about what everyone says is happening. let's make our channels better, our branch stronger, get more people watching us, so we have more to sell, and we can take that content around the world. that's half the company. >> i was going to ask you that, when you take the content around the world, when do you decide to tailor make the content for somewhere else and how do you do that? how would you go -- do you go over and try to put your finger
8:05 am
in the air in a foreign country and decide what's going to work there? do you have smart people who do that? >> here's what's unique about discovery. discovery itself the channel is about satisfying curiosity. that's universal. if you wake up in italy and put discovery on you don't think it's an american channel. discovery is the number one cable channel for men with 80% of the same content in almost 210 countries around the world. if you go to russia and you put on discovery, it's putin's favorite channel. the people in russia think it is a russian channel so one, our content works really well but it's not just discovery. animal planet also universal, almost 90% of our -- when we develop a show for animal planet we take it everywhere in the world. i.d. as i mentioned has been very successful for us. it's a top ten network in america. in the last nine months we've launched it in over 130 countries. >> "honey boo boo" is not on france. >> tlc is a little different. animal planet, science,
8:06 am
discovery, and now i.d., that content works. so we really have a different economic model. if we invest in a show like "gold rush" or we invest in a show with david salmani on animal planet, who will be here in a few minutes or susan lucci we take those shows around the world. those nichz, science is universal. tlc is more difficult. we have to do local content with tlc because it feels like an american channel. >> david is our guest host. we've been asking ceos and business leaders how they are planning for the end of the year with the fiscal cliff looming. right now we'll focus on how investors should deal with this event. joining us is restructuring titan dan arbess partner with parilla weinberg. you're saying people need to learn to love the fiscal cliff. what's there to love about it? >> we're going to have a deal here, and the best possible thing that can happen for the
8:07 am
economy is we get some sort of agreement on fiscal restructuring and fiscal reform. language is really important. we talk about the fiscal cliff, but this is not a fiscal cliff that we're going to dive off of. these are baseline policies that congress has already agreed in order to deal with the fiscal situation. now they're very messy policies. we ideally would like a better mix of tax arrangements and spending arrangements but the fiscal cliff policies, the baseline policies as the cbo refers to them will at least result in an immediate reduction of the deficit by about 40% to o50% and a long-term reduction in the deficit of 75%. that's an ambitious starting point that congress has established, an ambitious baseline and we now have something to work with. even if we went over the fiscal cliff and didn't come up with
8:08 am
something better in the way of a deal we would be left with debt-to-gdp higher than at any time since 1955. so there's a lot more work to do even after we fix this so-called fiscal cliff the first step. >> no argument over the long run you'll probably be in a better situation if you tackle the debt more aggressively early. just about every economist we talk to says if we go over the fiscal cliff and stay over the fiscal cliff, these tax increases and government spending cuts as propositioned here if they go through as expected that will put us back in recession. do you disagree? >> i think that will slow down the economy but do one thing. i'm not advocating we take the baseline, i'm saying let's use the baseline to negotiate a better deal when we can talk about what that might look like in a second. what i am saying is that if you go over at least you have some certainty. the greatest opportunity in the
8:09 am
economy right now is sitting on corporate balance sheets. you have $1.7 trillion that is ready to go into the economy. corporate managers are not investing their money because they're waiting for serncertainn what the fiscal deal is going to be. any deal is better than no deal. >> dan i had a mini revelation. it would bring a lot of certainty. i'm wondering how much the growth above 1.5% or 2%, if this were i don't think you'd get growth from this but the certainty and knowing you're tackling the deficit, you're saying maybe it will free up cash on corporate balance sheets. >> i believe it will. >> if we did 3% the effects of the cliff itself would be mitigated by the amount of increased revenue you got from 3% growth. >> exactly right. peter boockvar was on earlier and said you have to get activity into the economy,
8:10 am
creating certainty where there's uncertainty. >> he's so funny if we're all wrong about this. the government not spending nearly as much. that kills andrew, if we pull back on some of the -- you need the government spending to create demand. everybody knows that, dan. >> you need private sector spending, joe more than anything else and the greatest stimulus package we could get, $1.7 trillion of money not in the economy is on corporate balance sheets. >> don't you think the uncertainty hangs out there even if you go over the cliff, somebody will be out there fighting for it. >> i'm not advocating going over the cliff. all i'm saying is that when i say stop worrying and embrace the so-called fiscal cliff, accept the fact that we've got baseline projections now to work against. now, it's very messy. it's not optimal, and there are a lot of things that can be done around these things, for example on taxes, rather than having an across the board tax increase,
8:11 am
which hurts the middle class, you ought to focus on closing loopholes, eliminating tax expenditures, as i referred to. you ought to focus on let's face it, the highest brackets are going to pay more taxes under any scenario here and that's probably what needs to take place. you need to focus on the entitlement side i believe, a lot of people have talked about that, improving the efficiency of delivery of health care services, of procurement of defense. there's a lot of room for compromise. people get off their polarized positions and begin to think more creatively about what might be done. >> all of the stuff in it we want to do it. we tell greece to do it, it's like take your medicine, but when we have to do it it's like whoa, wait a minute. >> dan the thing that causes worry, when you hear from aetna's ceo says this happens he has to put his plans in place in the next two weeks if we go go over the fiscal cliff you'll see an increase by 1% in the
8:12 am
unemployment rate which means an increase of 100 basis points in health care costs he at aetna will have to lay off people. he's putting those plans in place. >> the numbers are sliding all over the place, becky. on the other hand if corporate managers look at what else is going on in the economy, the election is behind us, we've got very accommodative monetary policy, suddenly we have some level of certainty on the fiscal situation, you could suddenly see investment decisions being made and some of this $1.7 trillion on corporate balance sheets going into the economy. >> dan, can i just make sure that you're saying that this is something that happens if we go over the fiscal cliff and we come up with a better plan using the base lines, not necessarily if we go over the fiscal cliff and stick with those base lines? >> the base lines are the fiscal cliff. if we go with the base line it's not ideal but it's some level of certainty. i'm not advocating it. i think it's messy and no good for anybody. indiscriminate sfesratiequestra
8:13 am
cuts in spending, indiscriminate tax increases clearly not the way to go. we should be able to come up with something better. all i'm saying in a worst case if you went over either temporarily or if you went over, you know, on a more sustained basis, i believe that you would be able to work your way out of it, because there is underlying strength in this economy. this economy has proven itself to be resilient and there's tremendous things going on today. the iaea, the international energy agency for example over the weekend put out a new study saying the united states is going to surpass saudi arabia and russia to become the largest producer of oil. >> in like eight years. and the ceos, we talked to all of them and say wow. they're so worried about hitting their numbers for the next quarter they can't possibly -- if they get the slightest, if sales don't go up with what their plan is, it's like the end of the world for them. >> everybody wants the economy
8:14 am
to continue growing. >> cars, whatever business they're in, oh my god f there's a slight -- of course, they're talking their book the ceo. >> choices need to be made and when choices are made, commitment is better than uncertainty. >> dan, thank you. you've given us a lot to think about today and to talk about and we hope you will join us in studio sometime soon, too. >> thank you very much. >> thank you, appreciate it. coming up former ceo douglas holtz-eakin. >> look who is behind you. >> from "deadly affairs" susan lucci outlines tell tale signs of an affair, the queen of daytime making her way to the "squawk" set. we'll ask her if she could have spotted the affair that brought down the head of the cia. how are you?
8:15 am
8:16 am
8:17 am
investigation discovery is discovery communication's biggest growth story. 42 consecutive months of prime time gains and joining us is the host of the network's "deadly affairs" program, susan lucci. you might know her as erica kane on the long running soap opera "all my children" and gai'm
8:18 am
getting input. "deadly affairs" this isn't they're deadly, they ruin someone's career. someone has died. >> someone has died and joe you asked me earlier does someone have to die? that's the question, why don't people walk away, i don't know why or divorce would be an option, but these are love triangles, crimes of passion, just gone as wrong as they possibly can go. >> and you never run out. >> that is another shocking aspect of this. i mean truth is stranger than fiction, but what really makes my jaw drop is how many of these cases have gone on and are going on and they're going on next door and down the street. >> we have an "american greed" and never run out. >> what's great is first to have susan lucci as part of investigation discovery. lot of the soaps went away, we're about crime and investigation, our demo is women 25 to 54, and the idea of bringing susan to i.d., we thought that would be a natural. it turns out it was more
8:19 am
successful than we ever imagined. it's the number one show on i.d. on saturday nights, susan was, i was a huge fan during the day, but she's now a huge prime time hit for us on investigation discovery, and the network is just, has been a fantastic growth story for us and we'll take susan all over the world. she's already in 130 countries, within two years we'll be in over 200 countries because there's crime around the world. you were saying that you were a fan, you were watching. >> yes, this is the type of stuff when you're flipping through the channels okay, i will stay and watch this. >> when we reached out to you, susan, there's a lot of things you could have done. what made you say one i want to do this and i want to do it with investigation discovery. >> when "all my children" was canceled i thought going forward as sad as it was when we got that news, i have to go forward, wanted to go forward and in going forward i wanted to do something that i was excited about and that i would be in
8:20 am
good hands, and when henry schleif presented me with the wonderful notion of "deadly affairs" first of all, made me smile, made we laugh, it was well written and pictures of me erica kane in love triangle situations, some of me in jail with blood on my hands. i thought this is funny, i have to meet this man. when i met henry and his team, i knew instantly. henry is so dynamic, they're smart, their writing is good. if it ain't on the page, it ain't on the stage and the storytelling is so well done. >> how many have you done so far? >> ten. i've just finished the last episode for the season. >> we're going to make some news today. >> what's that? >> we're picking up -- don't get too excited. we're picking up "deadly affairs" for another season because it's a major hit for us. >> is this the first time she's learning this? >> susan found out over the weekend. she's pretty sure since it's the most successful show on
8:21 am
investigation discovery i think she figured it was coming back. >> i was thrilled to hear that news believe me. >> an opinion of yours, this is the crux of the matter, is it in everybody, the possibility of doing this, or are murderers already sort of there? i mean could anyone be driven to this or do you actually start out with the potential to actually end up doing this? i don't think i could ever do that, but given something like this, have you decided whether it's actually in all men's souls that they could do that? it's pretty deep. >> a really interesting question. i would love to think and do believe that i would walk away rather than do something like this. >> right. >> on the other hand -- >> because normal people seem to -- >> hold on you said men. is it more women -- >> either/or. i just mean people. >> it's both. >> do you have to be pre-disposed? >> how many of these people are seemingly normal would be pre-disposed or is it that passion just makes them go over the edge. >> i think it's passion.
8:22 am
>> that's what i mean so anybody. >> but joe, this is why i.d. is so successful, it's a basic formula and the first two or three minutes, somebody's dead. who did it? and as human beings we all have this great curiosity, like how could someone do this. >> could i do it. >> why would they do it and maybe could i do it. >> or could i avoid being a victim. >> what is the craziest story so far? >> i have to say as a person watching the news, i watch and my jaw drops and i think that's the worst thing i've heard and then the next thing happens and the same with the stories on "deadly affairs." i read the stories, i can't believe it, and then the next script is there. i think that's probably largely like theience members. there is a website for addicts of i.d., because they are addicted. you cannot stay away once you really do want to know what happens and i think that's a great thing about this, because some of these stories we read in the news, and then of course the
8:23 am
news media is on to the next, but with "deadly affairs" you get to see it re-enacted, you get to have interviews with people who were there, who were involved, and you get to hear what happened, what the outcome was. >> excellent. my interest is piqued. thank you very much for coming in. >> we get to work with susan lucci. >> my pleasure. >> on saturday nights. come up fixing the fiscal cliff, douglas holtz-eakin. former economic adviser to george w. bush, we're back in two minutes. how? cdw and hp networking implemented a virtual application network that reduces the time to deploy cloud applications from months to minutes. with fewer bottlenecks like this. finally. charles! client golf. aim for the lake. really?
8:24 am
he loves risk. but whether he's climbing everest, scuba diving the great barrier reef with sharks, or jumping into the market, he goes with people he trusts, which is why he trades with a company that doesn't nickel and dime him with hidden fees. so he can worry about other things, like what the market is doing and being ready, no matter what happens, which isn't rocket science. it's just common sense, from td ameritrade.
8:25 am
can i still ship a gift in time for christmas? yeah, sure you can. great. where's your gift? uh... whew. [ male announcer ] break from the holiday stress. ship fedex express by december 22nd for christmas delivery.
8:26 am
welcome back to "squawk box" everyone. in sports news, the los angeles lakers hired former new york nicks coach mike dantoni to replace mike brown, it was a three-year deal worth $12 million and this hire comes after rumors over the weekend the lakers were in discussions to retire former coach phil jackson. when we come back on "squawk," getting a deal on debt, douglas holtz-eakin will talk to us about avoiding the fiscal cliff, although our last guest wondered whether we should. it's getting wild in the green room this morning. the top brass at animal planet ready to pounce on a fiscal
8:27 am
cliff solution. we're going to ask this porcupine if lawmakers are actually just chasing their own tails. tdd#: 1-800-345-2550 this morning, i'm going to trade in hong kong. tdd#: 1-800-345-2550 after that, it's on to germany. tdd#: 1-800-345-2550 then tonight, i'm trading 9500 miles away in japan. tdd#: 1-800-345-2550 with the new global account from schwab, tdd#: 1-800-345-2550 i hunt down opportunities around the world tdd#: 1-800-345-2550 as if i'm right there. tdd#: 1-800-345-2550 and i'm in total control because i can trade tdd#: 1-800-345-2550 directly online in 12 markets in their local currencies. tdd#: 1-800-345-2550 i use their global research to get an edge. tdd#: 1-800-345-2550 their equity ratings show me how schwab tdd#: 1-800-345-2550 rates specific foreign stocks tdd#: 1-800-345-2550 based on things like fundamentals, momentum and risk. tdd#: 1-800-345-2550 and i also have access to independent tdd#: 1-800-345-2550 firms like ned davis research tdd#: 1-800-345-2550 and economist intelligence unit. tdd#: 1-800-345-2550 plus, i can talk to their global specialists 24/7. tdd#: 1-800-345-2550 and trade in my global account commission-free tdd#: 1-800-345-2550 through march 2013.
8:28 am
tdd#: 1-800-345-2550 best part... no jet lag. tdd#: 1-800-345-2550 call 1-866-506-9616 tdd#: 1-800-345-2550 and a global specialist tdd#: 1-800-345-2550 will help you get started today.
8:29 am
8:30 am
welcome back. u.s. equity futures indicated up about 30 points so far, a little bit of a rebound from an awful week last week. research in motion announcing it will hold a launch event for its new blackberry 10 operating system on january 30th, shares of r.i.m. during the last year painful but not nearly as painful if we went back five years or so. sports in concert promotion company anschutz's group plans to make stubhub part of a new ticketing service. aeg owns many around the world including the staples center in los angeles. aeg makes a lot more sense than aig. right? that makes no sense. >> i think it's shocking stubhub has done well. you couldn't scalp tickets. >> it should be obvious that
8:31 am
that would work, whenever -- look what happens, gas prices weren't able to rise the last two weeks and what happens? six-hour lines, if there had been a different line people could pay $10, $20 a gallon, people would have worked it out. prices need to go where they need to go. >> i want the kids to go to the concert. >> you're all about fairness, that's basically your life, being fair. >> president obama says he's going to be inviting congressional leaders of both parties to meet with him friday for talks on how to avoid the fiscal cliff. douglas holtz-eakin is the head of american action forum and we just flipped our rising above pin on the screen there, so we're going to ask you to rise above. >> okay. >> watches some of the weekend shows the republicans have moved a little bit on this tax issue at least suggesting they're willing to go up on the revenue
8:32 am
side, they might be able to go on the actual rate itself but maybe i'm reading too much into it. what do you think? >> i think it's been obvious for a while since john boehner put revenue on the table with the president last summer in 2011 we saw it in the super committee. there's never been an objection to more revenue. there's been concern about how the revenue gets raised and obviously i think the question now is when do you raise the revenue. it's baked in the cake that we're going to tax the wealthy more heavily beginning january 1 with the affordable care act, we have the surtax on net investment income and their payrolls, we have the payroll tax holiday expiring. seems to me that the real danger is trying to get too much in the lame duck, really risking economic downturn, and they should really settle the lame duck, get through it safely and focus on the big deal in the spring. >> so you don't think we'll hear too much on entitlements then over the next month and a half? >> there's a difference -- >> that's the crucial element of all this. the tax part is just a component
8:33 am
of that. >> sure. if you talk about how do we solve our fiscal problems the heart of that is entitlements, the revenue discussion has been going on. there's a different question which is how do you get past this automatic sunset of all the taxes in december, the automatic spending cuts. it seems to me that's an economic danger and the primary thing should be to recognize the payroll tax holiday is going away, doing as little more in the lame duck as possible to get through to the spring is the key. >> doug, i think about the way that we're talking now, and if we went up 39.6 on 250 or if we did it on a million, it's either 80 billion a year if you go above 250 or if you go all the way up to $1 million it's a fraction of that. >> yes. >> and that's these guys want that, that's all they think about. can someone explain to them if you were to get rid of some loopholes and broaden the base,
8:34 am
like a guy like warren buffett, if you raise 4% of his income, he doesn't pay himself any income. all that money is sitting, all that money is sitting there, and you can't touch it. >> capital gains. >> that's what i'm talking about. the rich people, the really rich people don't have any ordinary income. you can't touch them. can't you convince, can't you just tell these democrats that you can nail rich people a lot better this other way, and if you can convince them of that then they'd feel good, yeah, yeah, can we? they'd then understand that broadening the base, this huge amount of money that's out there that you can't touch by playing with ordinary income, but do you it with the loopholes, getting rid of those. if you could convince them, they would understand, that's the way to get out a lot more money to try to get a lot more revenue. >> i think the base broadening makes sense from two points of view. there's the revenue issue which is a big deal but number two our tax code is a mess. >> right. >> it's a great disservice to the economy to have a tax code
8:35 am
that drives up decisions on tax purposes, not on business principles. the base broadening is something that ought to happen for good economic policy. we are going to have to grow as rapidly as we can both on behalf of the people who are badly out of work and the fact that we need resources. there are enormous demand, that should be a given that we do some sort of serious tax reform. i understand they want to get high income people, they're getting it with this surtax, 4% on their net investment income, they may want more, but never forget that once you do all that, we're still not close to solving our debt problems unless there's a serious entitlement reform. >> what is the chance we get a deal early, we're not waiting until the last day of december at 11:59. there's already a worry and a real concern -- no, there's a real concern. >> i'm with you. >> this entire conversation is creating a level of uncertainty that might be slowing down the economy. >> i mean look, this should have been done a long time ago. every day we don't do it, it does inflict economic harm. uncertainty is a dangerous
8:36 am
thing. the irs does have to print tax forms and you have to know what the tax code is. the sooner this is done the better. having said that, you know the track record as well as i do, it often goes to the last minute, i'm afraid we might see that again. >> doug, it's dave. the u.s. tax rate on corporations 35%. >> right. >> it's a real challenge for us in terms of we're trying to create value around the world and yet there are all -- there's no tax rate of any industrialized country close to 35%. >> what is your effective rate? you're talking like a republican. if it's good for you -- >> what is this corporate tax rate? >> it's a little bit higher than 35% and khan dadely we're working hasrd to get it down. we do business in over 200 countries. >> you should love simpson-bowles, bring down the rates and get rid of loopholes. >> it is a very big issue. >> it's got to be done in combination. >> it's all about social issues for you?
8:37 am
you talk, i listen to you -- you make so much sense. i see what you're norm amelie like. you turned into a pretty good republican when it affects you, boy. >> we are looking at taking a fair amount of our -- we have to, all media companies, anybody that does business around the world has to say if we do business here it's 35%. if we do business somewhere else it's 20, and shareholders would say, yes, we have to create value for america, but we also have to be practical. the good news for us is we're really in business, we're not pushing something out to the countries. we got boots on the ground all over the world. >> you want a fairer tax code, too. >> fairer tax code. >> what is on the upper end? >> doug, what do you think about the tax rate for corporations? where will we end up on them? >> we are way out of line in two ways. number one the tax rates are too high and number two we're the last big country trying to tax worldwide income. that hurts international companies. if you're in brazil competing
8:38 am
with the german firm, they're paying only the brazilian tax. our firms are playing brazilian tax and a second layer of tax in the u.s. so we need to fix that, get the rate down to something that looks like 25% or lower. i think the president's proposal to 28 just isn't aggressive enough and again my fear is that you only go to 28 you won't benefit enough firms they'll be willing to give up their special tax privileges in exchange for a lower rate and the deal falls apart. an aggressively lower rate is the key there. >> i don't know what to make of this. doug thank you so much for joining us. >> thank you. >> i don't know if we have more questions now than we have answers but it is what it is. cnbc and finance are launching a series called "off the cuff" today, takes you outside the board room to show you what high impact leaders go off the clock. corporate tycoons will answer what they like, what they loath, what makes them get up in the morning, hopefully "squawk" and what inspires them and makes them most proud. man familiar to "squawk" viewers
8:39 am
warren buffett. >> i start reading a couple papers and at the same time perhaps eating haagen daz strawberry ice cream, whatever it may be, cinnamon toast, whatever i feel like eating. somebody is coming to see me, i put on a suit. if they aren't khakis and the sweater and i've put on the same khakis for probably 20 years and if i'm at home i'm in a sweat suit. >> when we come back, animal planet is hosting an executive committee meeting live on the "squawk" set as we approach the fiscal cliff. we'll ask this crocodile, a porcupine and a cobbcat if the bigger market driver is deficit uncertainty or animal certainty. [ jungle boogie ♪ >> ahh! [ male announcer ] at scottrade,
8:40 am
we believe the more you know, the better you trade. so we have ongoing webinars and interactive learning, plus, in-branch seminars at over 500 locations, where our dedicated support teams help you know more so your money can do more. [ rodger ] at scottrade, seven dollar trades are just the start. our teams have the information you want when you need it. it's another reason more investors are saying... [ a i'm with scottrade.
8:41 am
8:42 am
welcome back to "squawk box." futures looking green, dow jones looks like it will open up about 35 points higher, s&p 500 up four points, nasdaq 13.5 points. we have a few stocks to watch as well, shares of gilead sciences jumping on better hepatitis c data, more data set to be released this afternoon, abbott labs their hepatitis drug data
8:43 am
showed promise and celgene as well. this is a porcupine. i don't know if i should be anxious or not. stay away from the tail? >> you're fine. he's on a little run. >> i was reading the news and a little nervous. >> my favorite part of this guy he's a prehensile tail so if he gets two far away i can grab onto him. >> are those animal treats or cookies? >> tweet potatoes. >> can you introduce dave salmoni from animal planet. >> i will. >> dave sal mani is animal's large predator expert, animal planet is on track to have its best year yet and this morning we brought in a few friends to explain what's going on. >> this is a prehensile porcupine. we do a lot of this stuff from
8:44 am
animal planet. this helps us promote conservation. >> i've seen porcupines but never one like this. where is he native? >> a south american porcupine. he wants to travel and make a terrible mess of your desk. north american the quills are bigger, tails have squils throu quills on this. this guy's feet are far different than the porcupines we're used to, a lot thinner, take that, david. >> there goes the coffee cup. does he just like to eat? he's been eating for quite a while. >> he's losing his patience for eating. >> dangerous, not dangerous? >> you see the quills, these things fight predators so if i was a predator and if he felt nervous he'd puff them up. people think they shoot their quills. they can't. they have to press them up against you. if he gets upset he'll basically -- >> will he charge you?
8:45 am
>> he won't charge me. he just says give me sweet potato. >> that is a he. >> are you ready to see something else? >> yes. >> this is a great example by the way of what we do. john hendricks came up with this idea that everybody is curious about animals. >> oh, boy. hold on. >> here comes a bobcat. he takes these all over the world. >> he doesn't love to be up high on the table. >> i can come over? >> you can. i'm going to try to get him to find a settled spot. come over here, mom. he's more calm around his mom, we'll let mom stick around. >> have you been with him since he was a baby? >> pretty much. >> most of the guys are handleable. >> the bobcat looks small but my son is here, 15 months old and you said remove him. >> with all predators you generally never want a child around a predator. this guy would see that child and stalk it the whole time. it's obviously not good for a mom and not good for us. we try to teach all the predators that's bad behavior.
8:46 am
>> it's their natural behavior. >> as much as that porcupine was thinking give me that sweet potato this guy is thinking where is my next meal coming from. bobcats because they are a shy animal there's 12 cameras over here and he's sort of as they move he wants to know why and where he can hide. because they're a forested animal they'll hide in the bushes. you would be shocked, they'll all through north america. if you've hiked through any of the -- >> i've seen them out here. >> you're lucky, they're so rare. if you've walked two kilometers you've passed at least one. >> in yosemite there were several of them. >> yosemite is a great place where the animal started to get calm, relaxed and used to people. another great place for us to bring people, this is wild spaces, why they're important to have around. >> you say you are in favor of conservation. have you noticed an increasing awareness among americans when it come to those things? >> on for sure. you see hurricane sandy come
8:47 am
across, people want to know why and global warming becomes something we pay attention to again. animal planet and discovery channel put out the big documentaries like "life" and "planet earth" we know that the attention to those types of things get picked up so people fall in love with animals again. >> we have to go but there is a crocodile here. >> oh, wow. >> i got him. >> baby crocodile. whoa. >> don't go near this guy's face. you can come around again, i'll bring him into the light. his teeth are open specifically because he'd like to bite so don't get too close. this is not something you'll see in north america. this is the crocodile, the cousin to the alligator we're sort of used to. my favorite thing about these guys they are so prehistoric. they haven't evolved much in the last 800 years. they sit in the water sort of like this and you can see his nostrils at the top of his head, eyes and just behind his eyes you see the slits, those are his ears. i guy has evolved to sit in the
8:48 am
water like this, he's got his webbed feet for swimming and he just waits. anything that comes in contact with those jaws he'll grab it and once he gets it, that's it. this is the largest predator in africa, he can be over a ton. we've seen on animal planet he's grabbed a wildebeest by the head. they're fantastic predators. >> dave, thank you so much for today. we appreciate it. >> good to see you guys. >> thank you. we usually need to quote a stock to make it business oriented. shares of coach -- anyway, no. coming up the latest -- andrew is thinking what a nice wallet. i know you. you're the 1%, yes you are. the latest buzz from wall street head to the new york stock exchange next. the latest coffee machine from nespresso. modular. intuitive. combines espresso and fresh milk. a ♪
8:49 am
8:50 am
8:51 am
welcome to the world leader in derivatives. welcome to superderivatives. welcome back to "squawk box." look at futures as we set up the week. s&p 500 up almost five points and nasdaq would open 13 points higher. >> let's get down to new york stock exchange. faber there yet or is he
8:52 am
coasting and resting on his laurels this morning? >> upstairs making calls, breaking stories. what can i tell you? >> were you a fan of the ceo? he took it upon himself to just answer all of the negative stuff and here he goes. it looks like he's going to run this company. >> i have liked richard for many, many years. this is terrific. i'm thrilled he's been able to do stuff for his shareholders. when he came out against the bears, i thought it was textbook about how you have to take people on when you're confident. it was miraculous. we have david here too who broke the story. congratulations, david. >> thanks. >> jimmy, did you ever run into jeffries in your travel? >> he's a terrific guy. >> he's gone right now. >> passed away a long time ago. >> a few years. i saw one thing going. i watched the tape. anything else really hit you as news worthy today? >> i have to tell you, joe, we
8:53 am
talk about biotech. it's been the great story of america and i think it's coming close to doing an amazing job and how about bob with pancreatic cancer first line. this is amazing. people laughed at the acquisition. they're not laughing anymore. >> right. as you have pointed out, we may not manufacture everything here but in terms of biotech you love oil and gas and stuff like that, jim. biotech can be something for us in the future. >> we're fabulous at it. terrific. something we should take pride in. >> we should. there's faber. so you weren't in a suit. tell us what you were wearing when you called in. english leather? or nothing at all. >> you know. >> tmi. >> come on, all those mornings together, you don't know what i wear? >> never mind. we'll leave it at that. we'll see you in a couple
8:54 am
minutes. >> thank you. >> when we come back, we have the last word from our guest host. >> announcer: tomorrow on "squawk box," with the election in the books, politicians must rise above the partisan politics and find a solution for the fiscal cliff. the consequences are dire. >> if we go over the fiscal cliff, i have to react. i know where i need to pull back. >> it would be disastrous. things will get cut across everything and make it difficult to operate. >> announcer: what will it take to get a deal on deck? find out tomorrow on "squawk box" starting at 6:00 a.m. eastern. at optionsxpress we're all about options trading.
8:55 am
we create easy-to-use, powerful trading tools for all. look at these streaming charts! they're totally customizable and they let you visualize what might happen next. that's genius!
8:56 am
we knew you needed a platform that could really help you elevate your trading. so we built it. chances of making this? it's a lot easier to find out if a trade is potentially profitable. just use our trade & probability calculator and there it is. for all the reasons you trade options - from income to risk management to diversification - you'll have the tools to get it done. strategies. chains. positions. we put 'em all on one screen! could we make placing a trade any easier? mmmm...could we? around here, options are everything. yes mom, i'll place a long call to you tomorrow. i promise. open an account today and get a free 13-month eibd™ subscription when you call 1-888-280-0154 now. optionsxpress by charles schwab.
8:57 am
stock of the day, titanium metals. i don't know whether you noticed. there was one person he kept looking at. he was very envious. there is our guy that runs the set here. that's him. now, there is normal spikes. there is more product there. that's not -- you can't really see the very top there.
8:58 am
check that out. tell me that's not a defensive thing he's got up there. he can shoot those out. >> do you want me to stab him for you? >> let's get back to our guest host. we talked about it earlier. >> we really don't know what it will be. if you look at all of the new platforms for the next two to three years never a better time to be in the media business. we have traditional cable business domestically around the world and now we're selling to a love film over in europe. the cable guys want more content for tv everywhere. almost every platform wants content. we own -- we're very unique in that we own all of our content. when we do a deal to provide a different window, it's all increme incremental. you should see content companies that own content really find in
8:59 am
a lot of growth. >> they want to consume it in different ways. >> right now it's small. the economics are substantial particularly when you own the content. it's another bite at the apple. the question is in three, four, five, six years, does the consumption on those, does it cannib cannibalize. there will be substantial growth. more than the marketplace recognizes. people are still watching more tv than they ever have. and something is key to our strategy. everything that's going on here in the u.s. in terms of the change the way people are consuming content and the fact that growth has slowed, that's not what's going on in latin america. substantial subgrowth. viewership growth and new technologies they haven't had th

Squawk Box
CNBC November 12, 2012 6:00am-9:00am EST

News/Business. Becky Quick, Joe Kernen, Andrew Ross Sorkin. Business news and talk as the trading day unfolds on Wall Street. New. (CC)

TOPIC FREQUENCY Us 54, U.s. 36, China 24, Mexico 16, America 16, Susan Lucci 12, S&p 11, Washington 10, Tlc 9, Univision 7, Jeffries 7, New York 7, Europe 7, Becky 6, David Zaslav 6, Cnbc 5, Leucadia 5, Joe 4, Douglas 4, Carl 4
Network CNBC
Duration 03:00:00
Scanned in San Francisco, CA, USA
Source Comcast Cable
Tuner Virtual Ch. 58 (CNBC)
Video Codec mpeg2video
Audio Cocec ac3
Pixel width 528
Pixel height 480
Sponsor Internet Archive
Audio/Visual sound, color

disc Borrow a DVD of this show
info Stream Only
Uploaded by
TV Archive
on 11/12/2012